My article for the Daily Telegraph.
If Wednesday’s reports are tobe believed, Hinkley C nuclear power station will get the go-ahead this week after the project’s eleventh hour postponement in June – a sequence of events which hasas much to do with politics as withenergy policy.
In her first months asPrime Minister, Theresa May has wanted toshow she has a firm grip on all the big decisions facing her government and that just because David or George had said “yes”to something doesnot automatically mean that policy would go ahead unchallenged.Whether it’s overthe chair of the BBC Trust, grammar schoolsor Hinkley, there is clear blue waterbetween the approachtaken by Mrs May and the previous administration.
No-one should be too surprised by this. New Prime Ministers, even when from the same party as their predecessor, often change tack.One of the first things John Major did on taking over from Margaret Thatcher was to dump the poll tax.Gordon Brown promised MPs a vote on going to war to show that he wasn’t Tony Blair.
Whilean obvious ripple of apprehension went through the investor communityat the initial decision to reconsider the deal,this was matched by an appreciation of the changed political landscape that Mrs May faced. Anyinitial embarrassment in France and Chinawill fade very quickly. Given the timescales involved, a delay of weeks matters little.
Perception is important when dealing with international investors and world leaders, andMay has demonstrated to the Chinese that she is a seriousdecision-maker whois not to be lightly dismissed.We are a long way away from a Mrs Thatcher style “handbagging”in this case.
But crucially,everything the Government does at the moment must be viewed through the prism of Brexit.
By taking the difficult path ofreviewing the Hinkley agreement,Mayset a tone of toughness which will be essential if her government is to make a success out of Brexit. The role of the French government in theHinkley projectshould not be ignored in this context.
The initial economic figures since the vote to leaveare holding up, but the good news is inconsistent.This leaves the Government vulnerable.The Hinkley Point decision is aimed at building up a head of steam for investment which will deliver economic and energy benefits but also build a valuable skills base.
The investment is for the long-term, a clear sign that Britain remains a big global player and a friend of China and all potential inward investors. It reinforces the Government’s messageabout the benefits of working with Britain, blessed withits stable financial, legal and political systems.
A green light for the power stationwill inspire confidence in global marketsabout investing in differentparts of the UK’s infrastructure – HS2is oneobvious example, further energy projects and shale gas exploitation would be others.
There are party management benefits, too, for Mrs May. Approving the projectthis weekwould setthe backdrop for Liam Fox’s global trade negotiations andgives David Davis more weight across Europe and Boris Johnson something to shout about on his world tour to promote British business.
Whatever decision is taken on Hinkley,Mrs May would bebound to face some criticism but by reassuring investors and securing skilled jobs, she is sidelining many of those voices. A go-ahead would beclear direction on a policy that has long been called for.
What is critical now is that the Government maintains momentum on infrastructure and investment.Next in the Prime Minister’sin-tray is a decision on aviation capacity. If she deals with that one, Mayreally willprove that she means business in an area where her predecessorwasdistinctly lacking.
Meanwhile, countries around the world will now see a British Prime Minister who deserves respect.